Allegheny Technologies Inc. (ATI) said it plans to take a
non-cash charge of $5 million, or about 5 cents a share, in the
first quarter, to account for the anticipated impact of the
nation's recent health-care overhaul.
The maker of titanium, nickel-based alloys and superalloys, and
other specialty metals is the latest company to take a charge to
account for increased costs related to changes that will come from
the new health-care law. Specifically, the legislation prevents
companies from deducting tax-free subsidies it receives from the
federal government for providing retirees with prescription-drug
benefits.
Other companies to announce similar charges include AT&T
Inc. (T), Deere & Co. (DE) and Caterpillar Inc. (CAT).
Allegheny has a market capitalization of about $5.1 billion, and
reported sales of $3.05 billion in 2009.
The companies are taking the charges now even though changes in
the health-care law don't take effect until 2013. Administration
officials have said companies are exaggerating the impact of the
loss of the deduction because of their general opposition to the
new law.
Allegheny's shares closed at $55.73 on Monday. The stock is up
24% this year.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com